Demand for crude oil and gas will rise substantially in 2010. With the recovery in the world economy and increasing revenue prospects for fuel distributors and retailers, operating conditions will be more favorable.

AutomotiveVirtually the entire automotive supply chain in 2010 will be in far better shape than the disasters of the past two years:

This sector is poised to prosper from a recovery with the government’s allocation of $7.2 billion in stimulus funds. Throughout the recovery, M&A activity is expected to continue as telecoms attempt to position themselves to make the most of the converged communications world that will emerge over the next decade.

RetailFollowing a dismal year of retail demand over 2008 and much of 2009, the coming year is set to be far more positive for retailers:

Although spending in 2010 will not mirror the highs experienced throughout the economic boom, it will be significantly better than that of the past two years. eCommerce-related businesses will outperform the broader retail market, while women’s and children’s clothing sales will also experience favorable gains. However, men’s clothing will take longer to recover.

HealthOperators that provide elective treatments had some trouble during the first half of 2009, as the labor market has deteriorated and consumer sentiments remained weak. But, demand should intensify for these industries from mid-2010 onwards:

“VoIP has skyrocketed from non-existent to a massive application targeting telecom carrier’s voice revenues,” explained George Van Horn, senior analyst with IBISWorld. “Continuing cost advantages for service providers, improving service quality and the expected emergence of mobile VoIP during the next 10 years pave the way for VoIP to be the primary beneficiary of the next leg in telecom’s service development cycle.”

IBISWorld also added that over a 10-year time frame, the industries that outperform or underperform their peers are those that either benefit from competitive strategic advantages or worse, suffering from significant disadvantages. While the performance of the economic recovery will dominate near-term industry performance measures, innovative products, competitive costs and improving efficiency will continue to separate the winners from the losers in the upcoming decade (2009-2019).

Note:VoIP is a new industry that only began to earn revenue in 2002. In the short period to 2009, revenue growth accumulated to an astronomical 179035.8%.

Even Christmas tree sales are struggling this year, according to industry research firm IBISWorld. Real and fake tree sales are expected to decline 2.5 and 5.1 percent, respectively, as fewer people have multiple trees in their home (i.e. dining room and living room) this holiday.

“People are looking at every which way to save a buck but also continue with the Christmas spirit,” says Toon van Beeck, a senior industry analyst for IBISWorld. “That’s why we’re seeing an increase in do-it-yourself and used trees.”

One tree category expected to fare particularly well this season is used, fake trees. IBISWorld expects these tree sales to grow 4.0 percent this holiday.

Despite economic gloom casting a spell on consumer confidence this year, America’s darkest holiday is looking bright for retailers. According to industry research firm IBISWorld, Halloween sales are expected to reach a record-breaking $6 billion in 2009, up 4.2 percent from the $5.77 billion generated last year.

“Economic recovery appears to be around the corner and consumers are enthusiastically looking to escape their recessionary woes,” said Toon van Beeck, senior analyst with IBISWorld. “Even last year, when the outlook was much worse, the Halloween spirit remained unhindered as we saw total sales actually jump 5.1 percent from 2007.”

It appears an increasing number of people are buying treats this year, making candy the fastest growing holiday category. The average person is estimated to spend about $22.50 on Halloween treats in 2009.

Also fuelling this year’s record-breaking sales is the demand for holiday decorations. With Halloween falling on a Saturday this year, more adults are expected to join the fun. In fact, 32 percent of people celebrating the holiday will either host or attend a party. For this reason, IBISWorld expects decorations to reach its highest level yet at $1.64 billion.

“Halloween-related festivities are a growing trend and this is driving sales of decorations and candy,” adds van Beeck. “Dollar and variety stores stand to benefit from the 4.4 percent increase in decoration sales, as consumers look to purchase cheap and disposable thrills to make a memorable evening.”

Call it escapism or just good, old-fashioned fun, Americans of all ages show the desire to go all out when it comes to dressing-up. Costumes are expected to generate the greatest amount of revenue this Halloween, but growth is slight (2.4 percent) as consumers will apply more frugal but creative approaches when shopping.

”Despite more people participating in festivities, money is still tight and consumers will look to cut corners when it comes costume purchases,” said van Beeck. “Instead of buying a packaged costume, which can cost up to $60 on average, people will get more eclectic and opt for cheaper individual items.”

But given the lack of growth for the card category, not all cheaper items will fare well this year. While cards did well last year, as consumers chose to cut back on pricier categories, 2009 expenditures will revert back to traditional shopping habits.

“Although unemployment is still very high, the overall outlook is far rosier today than it was this time last year,” adds van Beeck. “For this reason, IBISWorld expects the upward trend in Halloween expenditures to continue its course for 2009, which despite economic conditions will prove to be the best year yet.”

While the $60.37 billion cosmetics industry on track to decline 1.2 percent in 2009, the niche market of cosmeceuticals is expected to increase 7.7 percent, according to industry research firm IBISWorld. Now accounting for $3.5 billion in revenue, cosmeceuticals have become a prospective growth area for businesses operating in the mature cosmetics industry.

“The development of new product categories like cosmeceuticals and dermocosmetics has grown considerably in the last five years, driven by America’s obsession with anti-aging and wellness,” said Toon van Beeck, senior analyst with IBISWorld. “Companies are taking the opportunity to manufacture more of these high-margin products which typically generate profits greater than the industry average of 10 percent.”

As a result of the burgeoning growth and demand for cosmeceuticals, retailers from department stores to big box stores have looked to shelve products like anti-wrinkle creams, bleaching agents and medicated lotions. The existence of these niche products means that small retailers like SkinCeuticals, Her Walk, and Dermelect Cosmeceuticals can enter and successfully operate in an environment that is exhibiting strong growth and observes less competitive pressures.

Additionally, cosmeceuticals command a premium price because consumers perceive the ingredients as being expensive and uniquely manufactured, with research and development (R&D) accounting for the majority of costs. However, R&D only represents about two percent of the industry’s cost structure, while the selling, general, and administrative costs (mostly marketing) represent a staggering 21 percent.

“Because the profit margins are higher on cosmeceuticals, companies have more money to spend on marketing,” adds van Beeck. “Businesses must continually convince buyers of the product’s benefits and break through competitive clutter to increase their sales.”

By 2011, IBISWorld predicts the industry will rise beyond $4 billion, and will continue to grow at near double digit rates for quite some time. Growth will continue to revolve around the perceived health advantages of cosmeceuticals in addition to the traditional cosmetic benefits.

“Manufacturers and retailers will continue to fuel demand for cosmeceuticals by developing and marketing a steady stream of new products,” said van Beeck. “New products in the pipeline present solid opportunities to bolster bottom lines and build customer loyalty, re-inventing the mature cosmetics industry.”

As beach season comes to an end and people head back to the tanning salons to maintain their hard-earned summer bronzing, there are major changes occurring in the tanning salon business.

Everyone knows the growing concerns about skin cancer is hindering the $2.7 billion tanning salon industry, which industry research firm IBISWorld expects will decline by 5.1 percent this year. However, the shift in consumers moving from tanning beds to tanning sprays may actually be a ray of light for the industry.

“By far, ray-lamp skin tanning is the number one revenue source for tanning salons at 72 percent, but growing awareness of the high cancer risk associated with their use continues to diminish market share,” said George Van Horn, senior analyst with IBISWorld. “Profit levels are higher with spray-on tanning booths; therefore the shift toward these substitutes may actually improve the industry.”

Although UV-bed tanning sessions on average cost from $5 to $7, the industry is reliant on high turnover, with sessions typically lasting 15 to 20 minutes. The rising popularity of spray-on tanners, which now account for 11 percent of industry revenue, is expected to grow to a whopping 17 percent in 2009.

“Tanning salons are operating in a mature market, and to stay in the game salons need to adapt to market trends and offer innovative spray-on tanning products and services,” added Van Horn. “Because this is a long-term shift, those who diversify their menu, such as providing health and beauty services, will also have a greater chance in generating revenue.”

Sales are lackluster for high-end jewelry retailers this year as Tiffany & Co. is declining much faster than the jewelry industry as whole, according to industry research firm IBISWorld. Analysts at the firm expect industry revenue to fall 4.8 percent to $28.26 billion this year, with price competition from big-box retailers, like Walmart, stealing market share sparkle from traditional jewelry retailers.

“Although luxury shoppers represent a small elite portion of the population, they are the primary target market for high-end jewelers,” said George Van Horn, senior analyst with IBISWorld. “Even the wealthy are cutting back on extra discretionary purchases like jewelry and watches.”

Tiffany is expected to generate earnings per share of about $0.34, which will represent a decline of 46 percent from the $0.63 cents per share compared to the same quarter in 2008. Also, revenue for the quarter is expected to be about $600 million, which will be down 17.3 percent from the $732 million for the same time in 2008.

The fourth quarter of 2009 should see a significant revenue boost compared to the tough Christmas trading period of 2008. It is during this period, the fourth quarter, when jewelry stores will begin to realize more solid returns and better operating performance. As a result, profitability is expected to rise from 10.5 percent of revenue in 2009 to 11.2 percent of revenue in 2010, as luxury spending slowly returns.

While some improvement in industry operating conditions is expected in 2010 as the economy improves, IBISWorld industry risk ratings for jewelry retailing will remain at a very high level. Despite some modest improvement in ratings during the past six months, jewelry retailing continues to have the highest risk rating among the 60 different forms of U.S. retailing that IBISWorld monitors.

Over the coming few years, one of the major challenges for the industry will be the entrance of De Beers into the Jewelry Stores Industry. De Beers is planning to stake its ground as a retailer with a long-term plan to open around 150 stores under the De Beers LV joint venture with LVMH Moet Louis Vuitton. IBISWorld estimates that this move by De Beers will further increase the competition and boost the consolidation that has been under way over the past few years.

“The Jewelry Stores industry is on the precipice of a restructure at both retail and wholesale level that forces players to move quickly to ensure long-term viability,” added Van Horn. “Tiffany will continue to be challenged in finding new ways of selling its products without compromising its brand.”